23 01 14 Reuters: Israeli billionaire sells Congo oil rights for 300 times purchase price

Gertler,
an influential figure in Democratic Republic of Congo's mining and oil sectors
with close links to the Kinshasa government, denies any wrongdoing in the sale
of Nessergy Ltd, which paid a $500,000 signing bonus for its block in
2006.

The
block lies near some of neighbouring Angola's most productive oilfields. At the
time it was acquired by Nessergy, the block was located in an area at the heart
of a maritime border dispute between Kinshasa and Luanda.

However,
the two countries have since created a zone of common economic interest in an
attempt to settle the border row. Last year, Congo sought to buy back the rights from Nessergy to
allow it to negotiate a new production sharing agreement with Angolan state oil
company, Sonangol.

According
to the contract for the April 2013 transaction seen by Reuters, Sonangol
financed the deal, paying Gertler's Fleurette Group $150 million for the rights
to the block. Congo will repay Sonangol out of future oil
revenue.

Fluerette
has been paid the fee but cannot access the money until a deal between the
national oil companies of Congo and Angola is finalised.

A
Fleurette representative said no major drilling had taken place in the Nessergy
block due to disputes over development rights. He said the $500,000 signing
bonus was the standard amount companies paid to Congo for oil rights at the time
the contract was agreed.

The
company said the value of its rights increased dramatically after oil was
discovered on the nearby Menongue field in Angolan waters in
2007.

TARGET
OF CRITICISM

Campaign
group Global Witness, however, said Nessergy's block was always likely to hold
significant oil reserves given its proximity to Angolan discoveries totalling
around 10 billion barrels.

"In
a 2005-06 licensing round signature bonuses for these blocks ranged from $900
million to $1.1 billion," the campaigner said in a statement, referring to the
nearby Angolan acreage.

Global
Witness also criticised the Congolese government for not publishing the deal within 60 days as required by
the law.

Because
Nessergy was incorporated in tax havens where owners are not obliged to divulge
their identity, it is unclear who owns the minority holding not belonging to
Gertler, and therefore who else benefits from the sale, the campaigner
said.

"Global
Witness is calling for an end to secrecy over beneficial ownership
internationally, as an essential step in the fight against corruption," the
campaigner said.

Gertler's
mining companies have been the target of transparency campaigners in the past.
Between 2010 and 2012 they obtained a number properties for sums widely
considered to be generous, before selling them on for large
profits.

According
to the Africa Progress Panel, headed by Kofi Annan, Congo lost out on at least
$1.36 billion in potential tax revenue in five deals with Gertler during this
period.

Fleurette
however stands by the deals. It said the Panel's criticism failed to "take into
account a series of other factors which will impact the value of an asset, or
simply state the wrong value of the transaction."

The
Gertler-controlled group insisted the Nessergy deal was good for Congo. It said
that joint production with Angola will earn the cash-strapped central African
nation between $1.3 billion and $3.6 billion. (Writing by Joe Bavier; Editing by
Daniel Flynn, editing by David Evans)